2014 (10) TMI 572

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....ehta. Sri.Jayesh S Mehta is in individual and M/s.Shanthilal O Mehta is a partnership firm doing the business of sale of Copra and Coconuts. In the course of search, certain bank accounts were found. Sri.Jayesh Mehta admitted in course of search that the amounts deposited in those bank accounts represented the part of sale proceeds that was not offered to tax in the returns of income filed by him and the firm M/s.Shanthilal O Mehta. Further in the course of search itself, Sri.Jayesh Mehta offered Rs. 62,27,30 5/- as undisclosed income earned from unaccounted trade in Copra. He also explained how that undisclosed income was invested in various assets that were out side the books of account. 3. The firm, M/s.Shanthilal O Mehta was carrying o....

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....profit basis. Considering the fact that, there is only one case of S R V and Sons brought on record by the learned Assessing Officer and all other cases relied on by the assessee does not have a margin in excess of 3.2%. The Appellate Authority estimated the gross profit at 4 % midway between the figures shown by the assessee and taken by the Assessing Officer. Accordingly, allow ed the appeal partly and held that the gross profit margin has to be taken at 4%. Aggrieved by the said order, the assessee preferred an appeal to the Tribunal. 6. The Tribunal on reconsideration of the entire material on record held that for the assessment year 2003-04, on gross sales of 2.12 crores, gross prof it of Rs. 14.00 lakhs was shown which was in the ran....

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....ed order passed by the Tribunal is required to be set aside. 8. Per contra, learned counsel appearing for the assessee supported the impugned order. 9. In the light of the aforesaid facts and rival contentions, the substantial question of law that arise for our consideration is as framed in the appeal me mo, which reads thus: Whether the Tribunal was correct in holding that the net profit should be estimated at 2% of the turnover, as against computation of undisclosed income by the Assessing Officer based on the deposits discovered in search in undisclosed bank accounts in respect of suppressed sales?" 10. The facts are not in dispute. The assessee adm its during the search that a portion of profit is not accounted for and it is deposit....